CONSUMPTION

Per person consumption of livestock products

Figure 11 shows per person consumption of animal products in Indonesia since 1969. According to Hutabarat (1996), information on consumption of dairy products before 1969 is not available. It seems that this is also the case for meat and for eggs. It is apparent from Figure 12 that consumption has increased dramatically since 1969, presumably because of income increases. In percentage terms, the largest increase occurred for eggs. Data presented later in this part of the report show that meat, eggs and milk are income elastic for all but the highest income families.

Figure 11. Annual consumption per person of meat, eggs and milk

Figure 12. Daily per person consumption of meat, eggs and milk

Price and income elasticities

An Indonesia study conducted by Oka and Rachman (1991) made use of cross sectional data collected in the 1987 national consumer expenditure survey (SUSENAS). According to the authors, this survey provides a “high quality series” (p53) of data. Demand models were estimated using a double log specification, with prices and income as explanatory variables. Seemingly unrelated least squares was used to obtain the parameter estimates. Estimates were obtained for five different income groups. Income group I had a monthly per person income of less than Rp. 25000; group II had an income range of Rp. 25000 to Rp. 74 999; group III had a range of Rp. 75000 to Rp. 149999; group IV income was from Rp. 150000 to Rp. 300000; and group V was over Rp. 300000. The results obtained by Oka and Rachman are reproduced in Table 49 and in Table 50. A number of the elasticity estimates have the wrong sign. While not commenting on these, Oka and Rachman acknowledge that in their models, “parameter estimates will suffer from bias caused by.... excluded variables” (p. 56).

Table 49. Own price elasticities by area and by income, national economic survey, 1987

Food group	Income Group										Indonesia
	I		II		III		IV		V
	urban	rural	urban	rural	urban	rural	urban	rural	urban	rural	urban	rural
Energy food
Rice & other cereals	0.34	0.11	0.34	0.06	0.29	0.13	0.18	0.33	-0.2	0.13	0.9	0.10
Starchy foods	-0.28	-0.25	-0.23	-0.20	-0.31	-0.24	-0.47	-0.31	-0.53	-0.31	-0.37	-0.21
Oil & fat	-0.50	-0.48	-0.36	-0.47	-0.44	-0.50	-0.47	-0.51	-0.26	-0.5	-0.37	-0.45
Body building foods
Fish	0.77	0.45	0.23	0.37	0.35	0.40	0.20	0.33	0.09	0.59	0.25	0.40
Meat	-0.30	-1.02	-0.43	-0.95	-0.54	-0.80	-0.49	-0.74	-0.50	-0.41	-0.42	-0.62
Eggs	-1.0	-0.69	-0.73	-0.75	-0.75	-0.76	-0.76	-0.72	-0.68	-0.83	-0.71	-0.72
Milk	-1.61	-0.87	-0.46	-0.09	-0.13	-0.08	-0.09	-0.07	-0.17	-0.26	-0.10	-0.07
Leguminous	0.26	-0.52	-0.34	-0.34	-0.33	-0.37	-0.32	-0.30	-0.12	-0.26	-0.13	-0.24
Body regulating foods
Vegetables	-0.01	-0.05	0.02	0.03	0.03	0.05	0.07	0.03	0.29	-0.04	0.17	0.12
Fruit	-0.50	-0.43	-0.24	-0.05	-0.21	-0.09	-0.24	-0.08	-0.14	-0.09	-0.18	-0.05
Miscellaneous	0.33	0.33	0.35	0.29	0.35	0.27	0.28	0.18	0.25	0.15	0.32	0.27

Source: Oka and Rachman (1991), p. 66

Table 50. Income elasticities by area and by income group, national economic survey, 1987

Food group	Income Group										Indonesia
	I		II		III		IV		V
	urban	rural	urban	rural	urban	rural	urban	rural	urban	rural	urban	rural
Energy food
Rice & other cereals	-0.08	0.24	-0.06	0.20	-0.05	0.15	-0.03	-0.15	0.06	0.01	0.03	0.16
Starchy foods	-0.01	0.15	-0.17	0.09	0.15	0.27	0.24	0.24	0.14	0.25	-0.09	-0.22
Oil & fat	1.40	1.10	0.67	0.94	0.67	0.80	0.57	0.51	0.26	0.05	0.38	0.53
Body building foods
Fish	-1.66	-1.54	0.95	0.94	0.36	0.69	0.19	0.18	0.22	-0.21	0.53	0.62
Meat	1.69	1.75	1.58	1.87	1.33	1.37	1.24	1.32	1.02	0.48	0.95	0.81
Eggs	2.36	2.94	1.38	1.41	1.18	1.38	1.04	1.10	0.45	0.79	0.50	0.76
Milk	0.16	0.01	0.27	0.04	0.23	0.15	0.26	0.16	0.08	0.47	0.05	0.01
Leguminous	0.87	1.33	1.10	0.88	0.94	0.76	0.87	0.85	0.40	0.42	0.38	0.48
Body regulating foods
Vegetables	0.73	0.70	0.56	0.71	0.62	0.75	0.57	0.62	0.32	0.33	0.35	0.50
Fruit	0.55	0.49	0.59	0.56	0.76	0.74	0.87	0.74	0.56	0.37	0.54	0.52
Miscellaneous	-0.02	0.01	0.09	0.05	0.16	0.17	0.36	0.32	0.43	0.27	0.14	0.07

Source: Oka and Rachman (1991), p. 67

Table 51. Elasticities for Indonesia, various authors

Item		Value
Corn
	own price elasticity	-0.261
	cross price elasticity with respect to cassava	0.056
	cross price elasticity with respect to soybean	0.027
Cassava
	own price elasticity	-0.390
	cross price elasticity with respect to corn	0.040
	cross price elasticity with respect to soybeans	-0.029
Soybean
	own price elasticity	-0.779
	cross price elasticity with respect to corn	0.025
	cross price elasticity with respect to cassava	-0.037
Beef
	own price elasticity	-0.515
	cross price elasticity with respect to poultry	0.155
Poultry
	own price elasticity	-0.647
	cross price elasticity with respect to beef	0.101
Expenditure elasticities
	eggs	0.80
	dairy	0.90

Table 52. Income elasticities for Indonesia

Item	Elasticity
Red meat	2.08
Meat	2.71
Eggs and poultry	2.16
Dairy	1.40
Red meat	1.3
Poultry	1.2
Pork	1.0
Fresh milk	1.2
Milk powder	1.0
Total livestock products - urban	1.2
Total livestock products - rural	1.6
Total livestock products	2.16
Pork	1.0
Duck eggs	1.0
Beef	1.2
Mutton.	1.2
Poultry meat	1.5
Poultry eggs	1.5

Source: Winrock International Institute for Agricultural Development (1986)